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PUBLISHER'S LETTER
Publisher & Editor-in-Chief
Leo Simpson, B.Bus., FAICD
Production Manager
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Bob Young
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2 Silicon Chip
Pay TV points the way
for Digital TV
Hands up all those people who are excited
about the prospects for digital TV broadcasting
in the next five years or so. What!? Is no one excited at the prospect of all those extra channels
with high definition pictures and digital sound?
Well, I’m not surprised really because we’ve seen
this show before, haven’t we? Remember the
announcements about Pay TV and how there’d
be this huge range of channels and everybody
and his aunt would find something to watch at
any hour of the day?
It hasn’t turned out that way with Pay TV at all. Not only has it been a pretty
big flop in Australia but the cost has been huge. We’ve got two (unfinished)
cable TV networks strewn around the streets and the likelihood that only one
of them will be viable in the long-term. And there is no prospect at all that the
losing network’s cables being removed, is there?
Even people who have Pay TV will tell you that they often have “30 channels
of nothing” to watch. They wonder if they should be paying the monthly fees
at all but the occasional good movie or sports event keeps them connected. But
what will happen when the Pay TV customers realise that there are going to be
a lot more “free to air” TV stations? They might just decide that they can survive
without Pay TV. There is a genuine prospect that all the money invested in Pay
TV will never generate a profit.
Just as with Pay TV, there are likely to be many twists and turns to the Digital
TV story before the ultimate farce unfolds. Did you know, for example, that as
part of the plan for the introduction of digital TV, that analog broadcasts will
close down in 2008? That’s just 10 years away or just eight years after digital
TV is supposed to start. Consider some of the ramifications. First, how many
people will immediately decide not to buy a new TV set, knowing that digital
TV is coming soon and that their old analog TV will probably last for at least
another few years? My guess is that analog TV prices are going to drop real soon.
Or will set-top converters become big sellers? How much will digital TV sets
sell for? No-one knows.
Second, what if you live in the country? Chances are that digital TV will not
arrive for many years and will the Government really want to shut down analog
services while country viewers still depend on them? It seems to be the same
story as with the proposed close-down of analog mobile phones by 2000, even
though country users might be left in the lurch.
Third, where are the “free-to-air” TV networks going to get all the extra programs to broadcast on all these new channels? They seem to have a big enough
problem now. What will happen when the existing advertising industry budget is
spread over all those channels? There won’t be enough money to buy or produce
decent TV programs for all time slots. What will it come down to? Talk-back TV?
And who wants to watch more TV programs, anyway? As time goes on, most
people are watching less, not more TV.
That’s quite a lot of questions. There aren’t any good answers. It’s all likely
to be a huge farce, with the Government of the day hurriedly introducing it to
distract us from the real issues of the day. That happened with Pay TV, didn’t
it? My feeling is that this whole concept is being rushed into by the Government
without any real thought about whether consumers need or want it. One thing’s
for sure. It will cause a flood of imported sets and that won’t be any good for the
Current Account Deficit at all.
Leo Simpson
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